Small Businesses may be individually petite, but as a sector they account for about half of the world’s overall Gross Value Added (GVA). About 90% of the world’s firms are Small-to-Midsize Businesses (SMBs), meaning that they are the backbone of the global economy, and they are utilizing cloud services at increasing rates. For small and medium companies, cloud computing, especially the SaaS model, is increasingly attractive as it does not require an up-front investment and SMBs can easily scale up as their business expands.
How are SMBs benefitting from cloud computing?
1. Customized Software
One indicator of the growth of SMB cloud adoption is the increase in cloud-based software designed for small businesses. From financial and CRM applications through project management and legislative products, thousands of solutions are available to SMBs. Growth in SMB’s cloud computing & services market is projected to grow from $43B in 2015, to $55B in 2016. In the UK 69 % of SMB’s now use cloud-based applications.
For SMBs, applications that offer email collaboration, web/e-commerce and office administration and productivity are top priority. Cloud services can improve productivity in all areas including CRM, help desks, billing, and so on. With the analytics and visibility into real-time statistics offered by many cloud-based applications, SMBs can take quick action when problems arise and benefit from business insights based on the generated data.
In small businesses, since owners and employees often wear more than one hat, task automation is crucial. Ultra small firms run by a single person are also on the rise – and so is their income in many cases. In the U.S. in 2013, over 30,000 such firms earned over a million in revenue! Although these earnings are not typical, it is highly unlikely that without the web and automation these micro-sized businesses could have achieved such fine results.
The automation built into many cloud operations is a lifesaver for IT Admins with a multitude of responsibilities, and little opportunity to develop expertise in specific areas. By eliminating the manual approach, an automated strategy ensures that applications integrate well with other critical applications throughout the deployment. This strategy can significantly reduce risk, while in parallel shorten cloud project timelines.
3. Performance and Business Continuity
For SMBs on tight budgets, the cloud allows organizations access to enterprise class features such as geo-location, which can improve performance for remote users.
The cloud’s inherent load balancing and backup on separate clouds provides another measure of business continuity; disaster recovery operations no longer rely on expensive on-premise servers, SAN, storage and so on. Depending upon the disaster recovery approach implemented, such as restoring data from one cloud to another, recovery from a backup cloud can be faster and more easily accomplished.
All aspects of business operations must be secured, including network security, encryption and key management; software development; access control and authentication; compliance, operating systems and system security, right down to physical security.
For small firms with security requirements but limited IT budget and staff (81% of small businesses do not employ full-time IT personnel), a security architect or engineer may be required to provide the security, privacy and risk management leadership traditionally provided by a CIO or CISO. Although the vast majority of medium-size businesses have dedicated IT staff, these admins rarely have the opportunity to develop expertise in specific areas such as security. Cloud Services Providers (CSPs) help IT in SMBs by delivering some of the highly expensive security infrastructure without the responsibility to manage and maintain this layer.
Since CSPs utilize a Shared Responsibility Model, SMBs are still accountable for securing the applications and services that run on the CSP’s infrastructure. An additional challenge arises in many cloud and hybrid environments as these deployments usually encompass multiple vendors; therefore unifying these security policies is often a considerable challenge. Security solutions that unify and automate security for cloud and hybrid deployments often require third-party solutions that are available on CSPs’ Marketplaces.
Cloud security solutions for SMBs must provide encryption to secure company data and deliver high availability so that company data is always accessible without requiring IT intervention. As SMBs often rely on remote employees and contractors, they require centralized identity management and access control to allow secure access to company resources. Lastly, as SMBs grow, they also expect their cloud security solutions to grow with them.
5. Cost Savings
Subscription-based pricing also ensures that payment is based on resources that are consumed, so smaller companies benefit by not having to purchase expensive hardware and applications that will only be partially operated.
Although cloud adoption among SMBs continues to rise, it is still not mainstream. Uptake in the cloud thus far has been stronger with applications that assist with everyday tasks and activities. Most small businesses are still only using a few cloud solutions, partially because few SMBs have full-time IT staff. Without specialized IT, small companies usually require solutions that can be setup and maintained with minimal overhead by non-expert staff. It is unlikely that cloud adoption rates will truly be widespread until access to cloud solutions is simpler, and more of these solutions are focused directly on the needs of the SMBs.